What is this move : a dip or a new down move ?
The Nifty finally saw trading without losses. While world markets fell overnight, the Indian Markets showed resilence. At 2950, the Index faced resistance. This resistance has resulted in almost 200 points of losses.
What is the trend ?
A difficult question to answer. The short term trend is Down, the intermediate trend is sideways while the long term trend is almost certainly a bear market.
The intermediate trend is what should concern traders. The Nifty made a pattern of higher highs and higher lows, suggesting that this trend was up. Now, this pattern has changed to lower lows. We have not seen a lower high yet. Therefore, we classify the current move as sideways.
What is required for a new trend ?
To confirm an intermediate downtrend, the Nifty should make a lower high. This means we should see a rally for a minimum of one day and then a decline. The rally should not go above 2950.
To confirm an intermediate uptrend, we should see a a reversal of the lower lows pattern. This requires a rally, then a low which is higher than 2738 - today's low. This process is not easy but in the Market, anything can happen.
How do you trade ?
Use Oscillators to buy and sell. This means that in a sideways market, the trader should be open to taking trades on both sides - buy and sell.
What are the Oscillators saying ?
We are reaching extreme levels on the lower end of the Oscillator range. Perhaps buying opportunites are likely to emerge soon enough. These will be swing trades, looking at small gains, but these should come.
Swing Trading Ideas
Sesa Goa has seen a correction from 100 to 89. The stock could give a bounce. Buy using intraday charts, or above the previous day's high.
Suzlon has seen a pattern of lower highs and lower lows. It is NOT a buying opportunity, t least not yet. Avoid it.
IT stocks, specially the big ones (Infosys, TCS) has DOJI patterns today. These patterns have come in at support levels, suggesting a buying opportunity.
What happens if the Market falls ?
Well, any move below the previous day's low is a red flag, suggesting weakness. Go short with proper money management (stop loss, control on volumes)
So, what is the summary ?
The Nifty remains in a trading range, although the break down below previous lows suggests weakness. The Trend is sideways.
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► 2011 (200)
- ► November (9)
► October (28)
- Answers to comments oct31-11
- Process of Consolidation Likely
- Nifty Pattern Targets Reached
- Happy Diwali
- Stock Selection (based upon their historical volat...
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- Niftnear ORB Trade
- A dip in an ongoing up trend
- TATA Motors Life Cycle
- Hindalco touches support
- Mystery of the missing trailing stop
- Nifty Live Oct 12-11
- Point and Figure Charts
- Aiming for a better trade
- Long term view of Nifty
- Zen stories for Traders
- Hero Motor Corp at its support level
- NR 7 in Nifty Weekly Chart
- trading with a gap open
- Silver Pushes against Resistance
- An unusual continuation pattern in the Nifty
- Sudden Rally
- Nifty at 4750
- There is a time to be old and a time to be bold
- Afternoon review
- Nifty - Long Term View
- Higher High - Higher Low pattern in CNX IT
- Bear market shows its strength
► September (53)
- The Bear Story
- Nifty in a well defined range
- Morning View Sept 29
- Nifty Options Trade
- Nifty on way to close higher for this F&O settleme...
- Learning Ideas
- Short term trend is up
- Something Better
- A tale of two trades
- Before the Open - Sept 26-11
- Reliance - something better
- Nifty - A long term view
- Adding value to your analysis
- ► 2010 (263)
▼ 2009 (293)
▼ February (22)
- Taking Profits
- Dont look now, but the Nifty is not falling!
- A relief rally ?
- Good Morning, Tuesday
- Saturday musings
- More weakness ?
- The Analyst as a Trading System
- Confused !
- Market sees a break down
- Still up but uncertain
- Down moves ?
- The wise are still worried
- Back to Square One ?
- After a big move, a narrow range day ?
- Is a bull hiding somewhere ?
- Whipsaws in Trend Following Systems
- Take it Easy
- We have seen this before
- Trading as a Profession
- It is still a trading range
- Good Morning, Monday
- The Wall Street culture in Dalal Street
- ▼ February (22)
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